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Germany's long slide away from the Nato spending target of 2 percent of GDP continued in 2014 despite renewed fears of a military threat to Europe from Russia, according to a new report.

The Stockholm International Peace Research Institute (Sipri) reported on Monday that Germany spent €35 billion on its military in 2014, or 1.2 percent of GDP.

That continued a trend which has seen spending slide from 1.4 percent of GDP in 2012 – well short of either the Nato target or the worldwide average of 2.4 percent.

“Germany of course is a considerably big economy, but they have less interest in military involvement because of historical reasons,” head of SIPRI's military expenditure project, Sam Perlo-Freeman, told The Local, referring to Germany's pacifism since the atrocities of the Second World War.

The report stated that within Nato, "very few member states are likely to meet the 2 percent of GDP pledge any time soon, although pressure is growing for increased spending", which Perlo-Freeman explained included within Germany.

"Frankly I think the Nato goal is unrealistic and would involve an increase in share of GDP that is absolutely unprecedented in peacetime," Perlo-Freeman said.

"For Germany it would involve major tax increases or cuts to social spending, of which I don't think German people would approve."

There were indications of a shift in stance from Berlin on Friday, as the Defence Ministry announced plans to bring 100 tanks out of mothballs, bringing the country's total up to 328.

That's still a tiny fraction of the 2,125 Leopard 2 tanks built for the Bundeswehr (German army) since 1979.

The report also pointed out that while eastern Europe had beefed up military spending amid the Ukraine crisis and Russian involvement, western European countries tended to budget for decreases in spending.

"With the changing situation in Europe, we might see changes in Germany, but I don't see major changes unless things in Ukraine and Russia completely deteriorate," Perlo-Freeman said.

"Western European countries are certainly concerned about the situation, but the dominant economic policy is still very much austerity, and they are also further away from Russia."

Neighbouring Poland increased spending from 1.8 to 1.9 percent of GDP – although the rise had been budgeted before the Ukraine crisis - while Estonia maintained it at the Nato-mandated two percent.

Ukraine itself boosted its defence spending by 23 percent.

For its part, Russia increased spending by 8.1 percent in 2014, although that had also been budgeted for well in advance.

The rise meant that Moscow is now spending 4.5 percent of its GDP on the military.

Germany remains in eighth place worldwide in real-terms military spending, behind India and ahead of Japan.

The USA accounts for around one-third of military expenditure worldwide at $610 billion, or 3.5 percent of GDP, almost three times China's budget and seven times that of Russia.